For years, Chinese companies such as Alibaba and Baidu headed to the U.S. to list their shares, citing its deeper capital markets and higher valuations. Now, one American biotech firm is betting on doing the opposite.

Axiom Biosciences, a San Diego-based developer of regenerative and genetic medicines, plans to go public in Hong Kong in 2027, followed by a secondary U.S. listing in 2029. The company says the "contrarian" move will open the door to sophisticated, biotech-focused investors while bringing it closer to clinical and commercial partners across Asia.

"Some of the most important science in the world is being built in the United States, but the way it gets funded hasn't kept pace," said Remo Moomiaie-Qajar, founder and CEO of Axiom. The Hong Kong exchange's stricter listing standards compared to the U.S. point to a mature biotech ecosystem, Moomiaie-Qajar told CNBC, while noting that recent biopharma listings in the city have outperformed those on the Nasdaq.

Public markets offer an alternative way to raise money as biotech firms face a tougher fundraising environment, he said. While clinical trials become more expensive as they progress, the pool of venture investors willing and able to write large checks gets smaller – especially for companies that did not secure major backers early on, he added. Chinese biotech firms have flocked to the city's bourse amid a government push and as innovative drugmakers' financing needs grow.

The Hang Seng Biotech Index in Hong Kong has climbed more than 75% since a low in January 2025, surpassing the roughly 40%-50% gains in the ICE Biotechnology Index and the Nasdaq Biotechnology Index, tracking U.S.-listed firms during the same period, according to LSEG data. "The U.S. remains the deepest and most institutionalized biotech capital pool in the world," said Danny Xiang, founding partner at the life science-focused private equity firm Fontus Capital.

"That depth is precisely why the most fundable, globally competitive assets still raise and list in the U.S.," and why it's rare for a purely American biotech firm to choose Hong Kong as its primary venue, he said. What's changed, however, is Hong Kong's growing appeal as one of the world's largest biotech fundraising hubs, helped by reforms introduced last year that streamlined the IPO process, Xiang said. Since 2018, 86 companies have listed in the city raising more than $17.8 billion, according to Hong Kong Exchanges and Clearing.

Global biotech firms are increasingly drawn to the city's expanding biopharma investor base and its proximity to Chinese pharmaceutical partners, which could help speed up clinical trials and lower costs. Still, Xiang said, local investors tend to favor companies with a clear China connection, backing assets where they see opportunities to co-develop, manufacture or sell products with Chinese partners. George Wu, a Hong Kong-based partner at law firm DLA Piper, said the Hong Kong biotech sector's lower valuations, relative to the Nasdaq, have also attracted more international investors seeking upside potential.

The U.S. is also on track for its strongest run of biotech IPOs in years, with both Parabilis Medicines, a clinical-stage cancer drug developer, and Kailera Therapeutics, an obesity-drug maker, soaring around 60% on their debuts earlier this year, after raising more than $600 million each.